Shopee sticks to scaling back plan, starts new round of layoffs - PingWest

Shopee sticks to scaling back plan, starts new round of layoffs

Shopee sticks to scaling back plan, starts new round of layoffs

2 hours ago

Southeast Asian e-commerce giant Shopee announced a new round of layoffs on Monday, affecting staff in human resources, regional operations, marketing and product and engineering, the Business Times reported. 

On Monday, shortly after the department-wide town hall ended, employees, including in Singapore and China, began receiving emails notifying layoffs.

While the specific number of layoffs is unknown, numerous employees claimed that Shopee's "cash-burning" business lines, such its food delivery service ShopeeFood, have taken a severe hit.

In an internal memo, the management said that “this was a very difficult decision to make”, and it will strive to “offer a fair package” for departing employees and will provide them assistance where needed.

The once booming Singapore-headquartered tech giant is downsizing and cutting costs as economic headwinds intensify.

Earlier this year, Shopee had also let go of its regional workers in its ShopeeFood and ShopeePay teams. Multiple job offers were withdrawn by the company in early September, prompting widespread indignation on Chinese social media. 

The e-commerce firm reasoned that due to adjustments in hiring plans, a number of roles at Shopee are no longer available. Shopee has been relocating a big number of Chinese IT talents to Singapore from its research and development center in China.

Most recently, Sea, parent company of Shopee, also trimmed staff in its gaming arm Garena and research and development unit Sea Labs.

Forrest Li, founder and CEO of Sea, noted that the group has been struggling in an era of rising interest rates, accelerating inflation, and a volatile market. He sees this as not a “passing storm”, adding that these will likely persist into the medium term.

Last week, Li made headlines after announcing in an internal memo that its top management will forego their salaries. He said that the leadership team will not take any cash compensation “until the company reaches self-sufficiency”.

As part of its effort to reduce costs, the corporation will also reduce spendings on business travel, which includes things like plane tickets, hotel stays, and meals, and eliminate reimbursement for meal and entertainment expenses.

Over the next 12 to 18 months, the company said it aims to be cash flow positive as soon as possible.

Sea's second-quarter financial report, released on August 16, showed that its revenue was $2.9 billion, a year-on-year increase of 29.0%. However, its net loss reached $931.2 million, more than double the $433.7 million in the same period last year.